Invoice discounting gives you the cash flow finance and debt management solution that your company needs to succeed. It provides you with immediate cash advances from the funds already owed by your customers (debtors), thus increasing your working capital. Invoice discounting companies will typically provide an initial cash advance up to 90% of the value of outstanding invoice. The invoice discounting agreement will also provide an ongoing facility that increases in line with the volume of sales and values of invoices you issue.

Invoice discounters will also provide finance against stock, plant and machinery and property.

Unlike factoring you maintain full control of your sales ledger, the issuing of statements and collection of cash. As a result the service charge is much lower.

You raise an invoice as usual. You send a sales daybook listing to the invoice discounter either by post or, more likely, via the internet.
The invoice discounter provides the agreed percentage of the invoice, up to 120 days old, by electronic transfer within 24 hours.
You send out statements and pursue payments.
The invoice discounter opens a trust account in your company's name into which you deposit all cheques received. Alternatively, you can include the bank details on your invoices and the client can pay directly into the account.
You notify the lender of all deposits as you receive them and then he credits you with the balance.
The invoice discounter provides statements showing all transactions although these details can be accessed by you at any time.